Business groups at odds over A-G’s plans to criminalise wage theft

Mr Willox also disagreed with an ACTU proposal supported by the federal government to allow individual workers to settle smaller wage underpayment claims more quickly.

“There is already a small claims jurisdiction in the Fair Work Act. It was never abolished and so the ACTU’s call for the small claims system to be brought back makes no sense,” he said.

Australian Industry Group chief executive Innes Willox says that heavy civil penalties are already in place under existing employment laws for breaches of awards.Credit:Dominic Lorrimer

While the BCA supports tougher penalties for businesses that deliberately underpay workers, it wants the Fair Work Ombudsman (FWO) to impose a less punitive approach against employers that underpay workers by mistake.

The FWO last week warned Woolworths it would hold the company to account for breaching workplace laws after it admitted to underpaying nearly 6000 workers up to $300 million.

The BCA submission to Attorney-General Christian Porter’s inquiry into the penalties for wage theft says a wider range of penalties should be available to distinguish non-intentional underpayments from deliberate breaches of employment laws.

“A balanced enforcement regime requires both carrots and sticks,” it says.

It says there is a need to modernise the Fair Work Act to ensure that “sanctions for the most serious breaches of workplace laws are more closely aligned to those that apply under other laws regulating business conduct”.

“The Business Council supports the introduction of criminal sanctions for such breaches,” it says.

The BCA submission comes as Mr Porter, who is also the Industrial Relations Minister, warned corporate Australia that directors of companies that failed to pay workers properly could be banned from ­sitting on boards.


Mr Porter said he would consider giving the Fair Work Ombudsman power to ban directors of underpaying companies. He also said he supported an ACTU proposal ­to allow workers to lodge smaller underpayment claims with the Fair Work Commission for quicker settlement.

The BCA submission says that, while it supports criminal sanctions for employment law breaches, inadvertent breaches should be dealt with in a non-punitive way.

“Members of the Business Council have expressed concern that the Fair Work Ombudsman has in recent times adopted an inflexible policy in dealing with non-intentional breaches.

“This has resulted in disproportionate remedies being applied to companies who identify their own breaches and self-report, as well as discouraging other companies from self-reporting when such breaches are discovered,” the submission says.

It also says there is a further case for increasing maximum civil penalties for breaches of workplace laws across the board. It says consideration should also be given to disqualifying company directors where they have a history of breaches of workplace laws.

Mr Willox said “calm consideration” of any changes to Australia’s already complex employment laws was needed.

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